97-3372(IT)I
BETWEEN:
EVE BIJAI,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
Appeal heard on October 19, 1998 at Toronto, Ontario, by
the Honourable Deputy Judge J.F. Somers
Appearances
For the Appellant: The Appellant herself
Agent for the Respondent: J. Espeso (Student-at-law)
JUDGMENT
The appeal from the assessment made under the Income Tax Act for the 1995 taxation year is dismissed in accordance with the attached Reasons for Judgment.
Signed at Ottawa, Canada, this 24th day of November 1998.
|
"J.F. Somers" |
D.J.T.C.C.
Date: 19981124
Docket: 97-3372(IT)I
BETWEEN:
EVE BIJAI,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
REASONS FOR JUDGMENT
Somers, D.J.T.C.C.
[1] This is an appeal pursuant to the informal procedure for the 1995 taxation year. The issue is whether the Appellant is entitled to deduct expenses for child care within the meaning of subsections 63(1) and 63(3) of the Income Tax Act (the "Act").
[2] In reassessing the Appellant the Minister of National Revenue (the "Minister") made the following assumptions of fact, which were denied by the Appellant:
"(a) the Appellant did not file prescribed form T778(E), with her return of income for the 1995 taxation year;
(b) the Social Insurance Number of the alleged caregiver subsequently provided by the Appellant to Revenue Canada is invalid;
(c) the Appellant did not incur child care expenses in the amount of $4,800 (the "Payments") in the 1995 taxation year;
(d) the Appellant has not proven the alleged Payments as, or on account of, child care expenses by filing with the Minister one or more receipts, each of which was issued by the payee and contains, where the payee is an individual, that individual's Social Insurance Number."
[3] In the year 1995, the Appellant had three children: Shan Bijai born September 11, 1987, Ricky Bijai born August 11, 1991 and Alisha Bijai born December 17, 1993. Since the Appellant worked for two different companies during the 1995 taxation year she had to hire babysitters. She worked full time for Kathgo Trading Company Inc.; her working hours were from 9:00 a.m. to 5:00 p.m., five days a week. She also worked part time for two other companies at different periods during the year; her working hours were then flexible.
[4] The Appellant hired Sandra Reid, 45 years old, as a babysitter paying her $720 per week. Sandra Reid who lived across the street from the Appellant babysat at the Appellant's home from 6:30 a.m. to 1:00 p.m. from January 1995 to November 1995.
[5] The Appellant did not request receipts from Sandra Reid nor did she keep records of her working hours while taking care of the children.
[6] Sandra Reid moved to some other area in October 1995 and the Appellant does not know where she lives and made no attempt to locate her. The Appellant was unable to give a valid social insurance number for Sandra Reid as the one provided was not valid.
[7] When Sandra Reid moved, the Appellant hired a student to babysit from 3:30 p.m. to 7:00 p.m. from October 1995 to December 1995. During that period, the student lived two streets from the Appellant. No receipt was obtained by the Appellant to prove the hours worked and no attempt was made to contact the student to obtain receipts. She did not consider it worth while since there was only a small amount involved.
[8] Agent for the Respondent advises that there are three deficiencies to the Appellant's appeal. A prescribed form for calculating child care expense deductions was not filed with Revenue Canada as requested. However, the form was produced in Court. The Respondent objected to the production of the form as being too late. In accordance with subsection 63(1) of the Act, there is no indication that the form should be produced in a certain period of time.
[9] Secondly, receipts were not produced to Revenue Canada or this Court. In the case of Y. Senger-Hammond v. Her Majesty the Queen, [1997] 1 C.T.C. 2728, Bowman J.T.C.C. states:
"The essence of section 63 is the deduction of child care expenses, not the collection of tax from babysitters. The language of the provision does not support the view that the filing of receipts is mandatory. For one thing, the word "shall" is not used. Rather it describes a method of proof, which is clearly formal, evidentiary and procedural."
I accept this reasoning that nothing in the section makes it mandatory to file receipts in support of the deductions. While it is not mandatory the Appellant must prove her claim. It appears from the T4 slips provided by her employers that the Appellant worked during the 1995 taxation year. It is reasonable to conclude that she needed a babysitter.
[10] In a letter dated October 30, 1996, Revenue Canada requested receipts to support her claim and also to provide the babysitter's social insurance number. The Appellant provided an invalid number and did not produce receipts. Even though the production of the social insurance number and receipts is not mandatory, the Appellant has a certain obligation to prove her claim. She made no attempt to locate the babysitter. She stated that she did not attempt to speak to the student to provide receipts because the amount was insignificant.
[11] In the case of Edward Wells v. Her Majesty the Queen, [1997], 3 C.T.C. 2581, Rip J.T.C.C. said:
"There is nothing in the evidence before me to suggest Mrs. Wells did not do what a reasonable person in similar circumstances would have done when she obtained the social insurance number. If the social insurance number that was given to Mrs. Wells was not correct, and as Mrs. Wells used her best efforts to obtain the number, Mr. Wells should not be prejudiced."
[12] In this appeal, the Appellant made no attempt to correct the deficiencies in supplying the receipts and valid social insurance numbers. While the requirements of section 63 of the act are not mandatory, the Appellant must present sufficient evidence to prove her claim. The legislation is enacted to be respected and not disregarded. If the Appellant had made a reasonable effort to meet the requirements of the Act, her claim in certain circumstances would have been accepted.
[13] In the case of Lucy Wanjiru Njenga and The Minister of National Revenue [1997] 2 C.T.C. 8, 96 DTC 6593, the Federal Court of Appeal stated the following:
"The income tax system is based on self monitoring. As a public policy matter the burden of proof of deductions and claims properly rests with the taxpayer. The Tax Court Judge held that persons such as the Appellant must maintain and have available detailed information and documentation in support of the claims they make. We agree with that finding. Ms. Njenga as the Taxpayer is responsible for documenting her own personal affairs in a reasonable manner."
[14] For the reasons given above, the Appellant did not prove the necessary documentation of her claim. The burden of proof is on the Appellant. Furthermore, the Appellant did not make a reasonable attempt to provide such information.
[15] The appeal is dismissed.
Signed at Ottawa, Canada, this 24th day of November 1998.
|
"J. Somers" |
D.J.T.C.C.
Cases cited:
Y. Senger-Hammond v. H.M.Q., [1997] 1 C.T.C. 2728
Edward Wells v. H.M.Q, [1997], 3 C.T.C. 2581
Lucy Njenga v. H.M.Q.,[1997],2 C.T.C. 8, 96 DTC 6593
COURT FILE NO.: 97-3372(IT)I
STYLE OF CAUSE: Eve Bijai and H.M.Q.
PLACE OF HEARING: Toronto, Ontario
DATE OF HEARING: October 19, 1998
REASONS FOR JUDGMENT BY: The Honourable Deputy Judge J. Somers
DATE OF JUDGMENT: November 24, 1998
APPEARANCES:
For the Appellant: The Appellant herself
Agent for the Respondent: J. Espeso (student at law)
COUNSEL OF RECORD:
For the Appellant:
Name:
Firm:
For the Respondent: Morris Rosenberg
Deputy Attorney General of Canada
Ottawa, Canada